2015 (12) TMI 1195 - HC - VAT and Sales Tax

Challenge to assessment order - When there are certain legal issues which the 1st appellate authority had failed to consider - Escapement of turnover under Section 27(1)(a) of the TNVAT Act - Best Judgment assessment - Held that - Petitioner is permitted to challenge the assessment orders dated 15.11.2012 before the 2nd respondent, within a period of four weeks from the date of receipt of a copy of this order. The petitioner shall comply payment of 50% of the disputed tax within a period of four weeks from the date of receipt of a copy of this order and also furnishing bank guarantee for the balance 50% of the disputed tax as volunteered by them, and on such payment and furnishing of bank guarantee, the appellate authority shall entertain the appeals and pass orders on merits and in accordance with law, after affording due opportunity to the petitioner. The said exercise shall be completed by the appellate authority within a period of six weeks thereafter. Further making it clear that till the disposal of the appeals, there shall not be any recovery. - Petition disposed of.

Summary

Issues:
Challenge to assessment orders dated 15.11.2012 and revised orders dated 15.05.2014 under Article 226 of the Constitution of India. Appeal against orders of the 2nd respondent appellate authority dated 30.09.2015. Violation of principles of natural justice. Jurisdictional issues under Section 27(1)(a) of the TNVAT Act. Best judgment assessment criteria. Error apparent on the face of the record. Competency of appeals filed before the 2nd respondent. Maintainability of writ petitions due to alternative remedy before the Tribunal.

Analysis:
The petitioner, a registered dealer under TNVAT Act and CST Act, challenged assessment orders dated 15.11.2012 and revised orders dated 15.05.2014. They contended that the proceedings violated natural justice principles due to lack of proper show cause notice. The petitioner also raised jurisdictional issues under Section 27(1)(a) of the TNVAT Act, arguing that the assessment orders lacked jurisdictional facts and were nullities. They cited the need for a fair best judgment assessment as per legal precedents. The petitioner highlighted errors in ignoring revised returns and the issuance of a notice before the completion of deemed assessment.

Regarding the appeals filed before the 2nd respondent, the petitioner argued that the dismissal on grounds of limitation was erroneous. They claimed that the revised proceedings dated 15.05.2014 were the operative orders, and the appeals were filed within the statutory period. The petitioner sought to challenge the assessment orders before the appellate authority, emphasizing legal issues not considered previously.

The respondents contended that the writ petitions were not maintainable due to the availability of an alternative remedy before the Tribunal. However, the Court acknowledged legal issues raised by the petitioner and allowed them to challenge the assessment orders dated 15.11.2012 before the appellate authority. The petitioner was directed to pay 50% of the disputed tax and furnish a bank guarantee for the remaining amount. The appellate authority was instructed to decide on the appeals within a specified timeframe without any recovery until the appeal's disposal.

In conclusion, the Court permitted the petitioner to challenge the assessment orders before the appellate authority, leading to the disposal of the writ petitions. The decision ensured fairness and adherence to legal procedures while addressing the jurisdictional and procedural concerns raised by the petitioner during the legal proceedings.